Significant

Thursday, December 29, 2016

Has the OPEC Rally Gone Too Far?

Oil prices continue to edge up as 2016 comes to a close, a dramatic turnaround for the industry compared to the start of the year.

In January, oil prices were melting down, dropping below $30 per barrel. The industry was panicking, slashing spending and jobs, and it was hard to see any evidence of a rebound. By December, things look much different. The industry is adding rigs back to the shale patch, oil prices are rising, the market is moving closer to balance, and the OPEC deal could accelerate that adjustment. The consensus is that oil prices will post further gains in 2017.But even as WTI trades above $54 per barrel – the highest price since the summer of 2015 – there are several reasons why oil should be trading much lower.Read more at Has the OPEC Rally Gone Too Far?